556 
SB5b 


Stewart 

Bondholders*  Conspiracy  to 
demonetize  Silver 


THE  LIBRARY 
OF 

THE  UNIVERSITY 

OF  CALIFORNIA 

LOS  ANGELES 


The  Silver  Question. 


BY 


WM.  JM.  STKWART. 


Boniolders  Conspiracy  to  Demonetize  Silver. 

LEGISLAriON  AFFECTING  NATIONAL  DEBT 

AND 

GOLD  AND  SILVER. 


UNFAITHFUL    TREASURY    OFFICIALS. 


HOSTILITY  OF  NATIONAL  BANKS. 


Independent   Financial  Policy   for  the   United   States. 


Free  Coinage  or  Enforcement  of  Existing  Laws. 


By  WM.  M.  STEWART. 


San  Francisco  : 

Print  of  Gio,  Spaulding  &  Co.,  414  Clay  Street. 

1885. 


556 
5Z5b 


WAE  ON  SILVEE. 


The  silver  question  is  a  contest  between  European  bond- 
holders and  the  laborers  of  the  world.  The  National  Banks 
of  the  United  States  are  the  allies  of  European  bondhold- 
ers. While  the  demonetization  of  silver  would  necessarily 
destroy  silver  mining,  that  fact  is  of  little  consequence  com- 
pared with  the  disastrous  efifect  it  would  have  upon  society. 
It  would  destroy  the  confidence  of  the  masses  in  the  good 
faith  of  their  rulers.  Nihilists,  socialists,  communists  and 
other  disturbers  of  the  public  peace  are  powerless  SQ 
long  as  the  people  believe  substantial  justice  will  be  admin* 
istered  under  the  present  systems  of  government. 

The  proposal  to  demonetize  silver  is  in  violation  of  exist* 
ing  contracts  for  the  payment  of  money.  It  emanates  from 
a  bondholding  directory  in  Europe,  and  its  purpose  is  tc 
enhance  the  value  of  all  obligations  for  the  payment  ot 
money. 

To  appreciate  the  designs  of  the  bondholders,  and  to  un- 
derstand their  motives  in  this  war  upon  silver,  it  is  neces- 
sary to  consider  the  bonded  debt  which  they  control. 

The  national  debts  of  the  world  aggregate  over  $26,000,- 
€00,000,  all  of  which  is  substantially  controlled  by  a  small 
European  syndicate.  If  we  exclude  India,  China  and  Japan, 
with  a  population  of  about  662,000,000  and  a  debt  of  about 
$1,100,000,000,  the  national  debts  of  the  remaining  civilized 
countries  are,  in  round  numbers,  $25,000,000,000,  and  the 
other  indebtedness  of  the  same  countries  is  estimated  to  be 
several  times  the  amount  of  the  national  debts.  But  if  we 
assume  that  all  other  bonded  obligations  are  only  equal  to 
double  that  amount,  we  have  a  total  of  $75,000,000,000. 
The  nations  owing  this  debt  have  a  population  of  488,000,  - 


2002990 


000,  about  38,000,000  of  whom  are  not  sufficiently  civilized 
to  pay  taxes.  Of  the  remaining  450,000,000,  not  more  than 
one  in  four  is  a  producer;  that  is  to  say,  only  112,500,000 
are  productive  laborers.  This  one-quarter  must  therefore 
not  only  support  the  other  three-quarters,  and  supply 
armies  and  navies  (for  purposes  hereafter  noticed),  but  it 
must  pay  an  annual  interest  of  at  least  four  per  cent,  on 
$75,000,000,000.  If  the  duration  of  a  generation  is  assumed 
to  be  thirty-four  years  (which  is  according  to  recent  esti- 
mates), the  enormous  sum  of  $102,000,000,000  must  be  paid 
by  each  generation  for  interest  alone.  If  nothing  but  gold 
will  satisfy  this  demand,  who  can  estimate  the  days  or  hours 
of  toil  requisite  to  procure  it?  If,  in  addition  to  this,  the 
debts  of  the  world  continue  to  increase  in  the  future — which 
is  most  probable  in  view  of  the  fact  that  during  the  present 
century  they  have  increased  more  than  300  per  cent. — the 
burden  of  the  producer  must  be  correspondingly  increased. 
All  countries,  however,  are  not  equally  involved.  The 
United  States,  with  greater  resources  than  any  other  coun- 
try, owes  comparatively  a  small  debt.  Based  upon  the 
foregoing  ratio  of  debt  to  population,  a  producer  in  this 
country  would  probably  be  required  to  pay  only  about  $500 
on  interest  account  in  a  generation  of  thirty-four  years,  if 
our  bonded  debts — national  and  corporate — should  remain 
what  they  now  are,  without  increase  or  diminution.  But  it 
is  to  be  hoped  that  our  national  debt  will  soon  be  paid,  and 
the  people  of  the  United  States  liberated  from  its  depress- 
ing influence.  In  Europe,  however,  the  situation  is  differ- 
ent. For  example:  In  France  each  individual  producer  (on 
the  assumption  that  thirty-four  years  is  the  period  of  a  gen- 
eration), must  pay  on  interest  account  alone  more  than  $2000, 
with  no  prospect  of  relief. 

CONDITION   OF   THE   DEBTOR. 

A  contract  of   indebtedness    is    an  undertaking  on    the 
part  of  the  debtor  to  deliver  at  a  future  time  to  the  creditor 


a  certain  amount  of  property  or  money  named  in  an  obliga- 
tion. The  condition  of  the  debtor  owing  money  is  precisely 
analogous  to  that  of  a  person  who  agrees  to  deliver  wheat, 
corn,  cotton,  or  other  farm  product,  at  a  future  time,  or  after 
the  same  shall  have  been  harvested.  If  his  crop  is  good, 
the  seller  can  deliver  the  article  required  at  the  designated 
time;  but  if  his  crop  fails,  it  may  become  difficult  or  even 
impossible  for  him  to  comply  with  his  contract.  His  con- 
dition is  also  like  that  of  a  person  who  sells  stock  "  short." 
That  is,  he  agrees  to  deliver  at  a  future  time  a  certain  num- 
ber of  shares  which  he  does  not  then  possess.  If,  when  the 
time  for  delivery  arrives  stock  is  plenty,  the  contract  can 
be  easily  performed;  but  if  the  stock  has  been  "pooled,"  or 
by  any  other  means  taken  out  of  the  market,  compliance  may 
be*  impossible. 

BONDED  DEBT  PAYABLE  IN  GOLD  OK  SILVER. 

The  175,000,000,000  bonded  debt  was,  at  the  time  it  was 
contracted,  an  agreement  on  the  part  of  the  debtor  to  de- 
liver to  the  creditor  at  the  various  times  named  in  the  sev- 
eral contracts,  either  gold  or  silver,  at  the  option  of  the 
debtor.  If  silver  is  to  be  withdrawn  from  the  money  of  the 
world  so  that  it  cannot  be  delivered  by  the  debtor  in  dis- 
charge of  his  obligation,  the  contract  will  be  changed  and 
the  debtor  injured.  Money  will  be  scarce — there  will  be  a 
failure  in  the  crop  of  coin;  in  other  words,  demonetization 
of  silver  means  a  "corner"  in  money. 

AMOUNT  OF  COIN  IN  CIECULATION  AN  ELEMENT  IN  ALL  CONTRACTS . 

The  amount  of  silver  coin  in  the  world  when  the  war  on 
silver  commenced  is  supposed  to  have  been  about  equal  to 
the  amount  of  gold  coin.  All  contracts  were  made  with  re- 
ference to  the  amount  of  coin  in  circulation,  relying  on  the 
probable  production  of  the  mines  to  keep  good  the  world's 
stock  of  money.  If  the  mines  of  either  metal  are  more  pro- 
ductive than  usual,  the  debtor  is  benefited,  and  the  creditor 


has  no  reason  to  complain,  for  that  contingency  entered 
into  the  contract.  Nor  can  the  debtor  complain  if  the 
mines  cease  to  produce,  for  he  contracted  to  deliver  coin, 
and  made  no  condition  relieving  him  of  his  contract  in  con- 
Bequence  of  scarcity  of  coin  resulting  from  natural  causes. 
So  long  as  the  option  of  the  debtor  to  pay  in  either  gold  or 
silver  remains,  and  the  units  of  money  are  unchanged,  the 
obligation  of  the  contract  is  not  violated.  It  is  true  when 
both  gold  and  silver  are  used  as  money,  the  amount  of  coin 
in  the  world  as  compared  with  wealth  and  population  fluctu- 
ates, and  the  value  of  money  changes.  This  cannot  be 
remedied  until  some  device  shall  be  adopted  by  govern- 
mental action,  whereby  the  number  of  units  of  money  shall 
bear  a  fixed  relation  to  the  wealth  and  population  of  the 
country  in  which  such  money  is  circulated. 

UPON  WHAT   THE  TALUE   OF   MONEY  DEPENDS. 

The  value  of  a  unit  of  money  in  any  country  must  depend 
upon  the  number  of  such  units  in  circulation  as  compared 
with  wealth  and  population,  and  not  upon  the  material  of 
which  the  money  is  manufactured.  The  ratio  between  the 
wealth  and  population  of  most  countries  is  practically  a  fixed 
ratio;  in  other  words,  the  increase  or  decrease  of  the  pop- 
ulation will  substantially  indicate  the  increase  or  decrease 
of  the  aggregate  wealth  of  a  nation.  If,  therefore,  the  ratio 
of  units  of  money  to  the  number  of  inhabitants  of  a  country 
remains  the  same,  it  will  preserve  a  fixed  ratio  of  money  to 
both  wealth  and  population.  A  monetary  system,  therefore, 
regulated  as  to  the  number  of  units  in  circulation  by  the 
Dumber  of  inhabitants  of  the  country  in  which  such  money 
IS  circulated,  will  approximate  as  nearly  as  practicable  to  a 
perfect  system.  It  matters  not  what  number  of  units  of 
money  per  capita  exists  in  any  country,  provided  that  the 
ratio  of  population  to  such  units  is  constantly  maintained. 
When  that  ratio  is  changed  by  a  diminution  of  the  quantity 
of  money  we  call  it  contraction;  and  when  the  ratio  is  dis- 
turbed by  abundance  of  money  it  is  called  inflation. 


BI-METALLIC   MONEY  PREVENTS    VIOLENT    FLUCTUATIONS    IN   THE 
VALUE   OF   MONEY. 

Our  objection  to  the  demonetization  of  silver  is  that  it 
involves  violent  and  continuous  contraction.  The  use  of  the 
two  metals  (as  we  have  already  seen)  does  not  furnish  a  per- 
fect monetary  system.  It  does  not  altogether  avoid  the 
evils  of  expansion  and  contraction,  but  does  have  a  tend- 
ency to  prevent  violent  fluctuations  in  the  value  of  money. 
Over-production  of  one  metal  is  generally  offset  by  a  failure 
of  production  of  the  other.  Although  the  two  metals  do  not 
serve  the  highest  ideal  purpose  of  money  by  furnishing  the 
exact  amount  necessary  to  maintain  at  all  times  the  same 
relation  numerically  to  population — and  thereby  afford  an 
invariable  rule  with  which  to  measure  values  and  adjust 
contracts — yet  they  approximate  more  nearly  to  such  ideal 
standard  than  either  metal  alone  could  possibly  do.  It  is, 
therefore,  not  only  dishonest  but  inexpedient  to  dispense 
with  the  use  of  either  metal  until  a  more  certain  standard 
than  metallic  money  by  which  to  measure  values  and  adjust 
contracts  can  be  devised. 

SHAM  PRETENSES   OF   BONDHOLDERS. 

The  various  excuses  put  forth  by  the  bondholders  for  the 
demonetization  of  silver  are  insulting  to  the  understanding 
of  mankind.  They  say  they  prefer  gold  because  it  is  more 
convenient  than  silver.  They  might  as  well  tell  us  that  they 
prefer  platinum  because  it  is  more  convenient  than  gold.  It 
is  not  a  question  of  convenience — it  is  a  question  of  common 
honesty.  The  object  of  demonetizing  silver  cannot  be  con- 
cealed by  such  sham  pretenses — it  is  to  enhance  the  value 
of  securities. 

HISTORY   OF   THE  BONDHOLDERS'  WAR  FOR  CONTRACTION. 

The  effort  to  contract  the  coin  of  the  world  for  the  benefit 
of  the  bondholders  commenced  more  than  thirty  years  ago. 


8 


Exaggerated  reports  from  the  gold  fields  of  California  and 
Australia  brought  forth  appeals  from  Chevalier  and  other 
representatives  of  European  bondholders  for  the  demonetiza- 
tion of  gold,  with  the  avowed  purpose  of  increasing  the  value 
of  bonds.  Germany  and  Austria,  in  1857,  actually  demone- 
tized gold  in  the  interest  of  the  bondholders.  France  fa- 
vored the  demonetization  of  one  of  the  precious  metals,  but 
seemed  to  think  it  was  best  to  demonetize  silver  and  con- 
tract the  world's  money  to  a  gold  standard.  After  years  of 
discussion  the  French  Monetary  Commission  of  1869  came 
to  the  following  conclusion : 

"As  Governments  control  the  weight  and  standard  of 
money,  they  ought,  so  far  as  possible,  to  assure  its  value. 
And  as  it  is  admitted  that  the  tendency  of  the  metals  is  to 
•depreciate,  this  tendency  should  be  arrested  by  demonetiz- 
ing one  of  them." 

The  only  reason  assigned  by  Chevalier,  the  Monetary  Com- 
mission of  France,  and  other  representatives  of  the  bond- 
holders, for  the  demonetization  of  one  of  the  metals  was  the 
-appreciation  of  the  value  of  bonds.  They  did  not  pretend 
that  the  people  at  large  would  be  benefited  by  the  demone- 
tization of  either  metal,  but  boldly  declared  that  it  would 
increase  the  value  of  bonds,  and  that  such  was  their  pur- 
pose. 

WAR   FOR    CONTRACTION  CONCENTRATED   ON  THE  DEMONETIZATION 

OF  SILVER. 

The  discussions  in  monetary  commissions  and  financial 
circles  as  to  the  propriety  of  demonetizing  one  of  the  precious 
metals  in  the  interest  of  the  bondholders  continued  from  time 
to  time  until  1871.  About  that  time  exaggerated  rumors  in 
regard  to  the  fabulous  amount  of  silver  which  would  be  pro- 
duced from  the  Comstock  obtained  circulation.  Germany, 
not  having  succeeded  in  obtaining  an  international  agree- 
ment to  demonetize  gold,  seized  upon  these  rumors  as  a 
pretext  and  demonetized  silver.     The  United  States,  by  the 


9 


Acts  of  1873  and  1874  (hereafter  noticed),  did  the  same. 
Sweden  and  Norway  in  1874,  followed  the  bad  example  of 
Germany  and  the  United  States.  France,  Belgium,  Switzer- 
land and  Italy  in  the  same  year  so  limited  the  coinage  of 
silver  as  to  practically  demonetize  it.  In  1875  Holland 
closed  her  mints  against  the  coinage  of  silver  on  private 
account.  In  the  same  year  Switzerland  refused  to  coin  sil- 
ver. In  1876,  the  President  of  the  French  Republic,  under 
a  law  authorizing  him  to  do  so,  suspended  the  coinage  of 
silver.  In  the  same  year,  Spain  closed  her  mints  against 
depositors  of  silver.  Since  that  time  no  European  nation 
has  shown  the  least  disposition  to  remonetize  silver.  On 
the  contrary  the  tendency  has  been  in  the  other  direction. 

THE  ABSUEDITY   OF    ASKING  EUROPEAN   BONDHOLDERS     TO    REGU- 
LATE AMERICAN  FINANCES. 

In  1881  a  monetary  convention  was  held  in  Paris,  to 
which  the  United  States  sent  Commissioners,  for  the  pur- 
pose of  inducing  the  European  Governments  to  agree  upon 
some  basis  whereby  silver  could  be  used  as  money.  The 
folly  of  sending  Commissioners  to  such  a  convention  will  be 
appreciated  when  the  fact  is  stated  that  the  majority  of  that 
convention  was  necessarily  composed  of  the  bondholding 
class.  The  indifference,  bordering  on  contempt,  with  which 
the  proposal  of  the  United  States  to  remonetize  silver  was 
received,  should  have  been  anticipated.  It  ought  not  to 
have  been  expected  that  the  bondholders,  who  controlled 
the  Paris  Convention,  would  remonetize  silver,  and  thereby 
depreciate  the  value  of  their  securities. 

IS  MANTON  MARBLE  TO  IMPORT  FROM  EUROPE  INSTRUCTIONS  TO 

CONGRESS  ? 

The  present  administration  has  renewed  the  practice  pur- 
sued by  our  Government  since  the  war  on  silver  commenced 
of  colluding  with  the  enemy.  In  May  last  the  Hon.  Thomas 
F.  Bayard,  Secretary  of  State,   by  order  of  the  President, 


10 

sent  Mr.Manton  Marble — amono-metallist — to  Europe  for  the 
ostensible  purpose  of  obtaining  the  "  adoption  of  a  com- 
mon ratio  between  gold  and  silver  for  the  purpose  of  estab- 
lishing interuationally  the  bi-metallic  money  and  securing  a 
fixity  of  value  between  those  metals."  Mr.  Bayard  at  the 
same  time  wrote  to  the  American  Ministers  in  England, 
France  and  Germany,  requesting  them  to  assist  Mr.  Marble 
in  the  accomplishment  of  his  mission.  He  expressed  great 
solicitude  for  an  early  report  from  Mr.  Marble,  and  added : 

' '  I  trust,  therefore,  that  no  later  than  the  1st  of  November 
next,  with  the  assistance  of  Mr.  Marble's  labors,  you  will 
enable  the  President  to  lay  before  Congress  such  informa- 
tion, coupled  with  proper  suggestions,  which  may  make 
practicable  such  legislation  as  will  meet  the  grave  emer- 
gency." 

The  ignorance  of  Mr.  Bayard  of  the  history  of  the  de- 
monetization of  silver  in  Europe  and  the  attitude  of  the 
bondholding  directory  is  surprising.  How  he  could  have 
expected  that  Mr.  Manton  Marble — a  mono-metallist — would 
be  able  to  induce  the  European  bondholders  to  adopt  a  ratio 
between  gold  and  silver,  for  the  purpose  of  establishing  in- 
ternationally bi-metallic  money,  is  incomprehensible.  It  is 
possible,  however,  that  Mr.  Bayard's  real  object  for  sending 
Mr.  Marble  to  Europe  was  to  enlighten  the  American  peo- 
ple, by  spreading  before  them,  in  an  official  form,  the  rea- 
sons of  the  bondholding  directory  for  the  violation  of  the 
obligation  of  contracts  in  the  demonetization  of  silver.  He 
says  that  he  wants  Mr.  Marble's  report  to  "enable  the 
President  to  lay  before  Congress  such  information,  coupled 
with  proper  suggestions,  which  may  make  practicable  such 
legislation  as  will  meet  the  grave  emergency."  In  other 
words,  he  desires  Mr.  Marble  to  collect  and  import  from 
Europe  information  and  suggestions  from  the  bondholding 
directory  to  guide  Congress  in  its  deliberations.  A  mo- 
ment's reflection  would  have  satisfied  Mr.  Bayard  that  the 
bondholding  directory  is  sufficiently  interested  in  the  actions 


11 

of  CoDgress  upon  the  silver  question  to  furnish  all  the  in- 
formation in  its  power,  without  the  expense  of  sending  Mr. 
Marble  to  Europe. 

It  is  gravely  suspected  by  many  that  the  European  bond- 
holding  directory  had  somethiug  to  do  with  the  clandestine 
legislation  whereby  the  legal  tender  character  of  the  silver 
dollar  was  destroyed  in  the  revision  of  the  laws.  Every 
American  citizen  of  ordinary  intelligence  knows  that  it 
would  be  less  difficult  to  induce  Shylock  to  surrender  his 
pound  of  flesh  than  it  would  be  to  obtain  from  Europe  a 
recommendation  for  the  restoration  of  silver  to  the  place  it 
occupied  when  the  bonded  debts  of  the  world  were  con- 
tracted. It  is  to  be  hoped  that  the  sordid  views  of  the 
bondholders  have  not  reached  the  President,  and  that  his 
forthcoming  message  will  contain  no  argument  imported 
from  Europe.  The  power  of  $75,000,000,000  has  already 
subsidized  the  genius  of  Europe  and  the  metropolitan  press 
of  America  to  invent  reasons  why  the  debtor  ought  to  pay 
two  dollars  when  he  has  contracted  to  pay  but  one. 

HOW  THE  PRICE  OF  SILVER  WAS   AFFECTED   BY   HOSTILE  LEGISLA- 
TION. 

After  silver  was  demonetized  and  the  fact  became  known 
by  the  refusal  of  the  mints  to  receive  it  in  exchange  for 
coin,  its  value  declined,  as  compared  with  gold,  until  the 
year  1878,  when  its  partial  remonetization  by  Congress 
checked  its  further  decline  and  produced  an  upward  ten- 
dency, which  continued  until  the  recent  adverse  action  of 
the  present  administration.  It  is  now  more  than  twenty-one 
per  cent,  below  par  in  gold.  In  1873  (when  silver  was  de- 
monetized), the  amount  of  silver  necessary  to  make  a  silver 
dollar  was  worth  over  three  cents  more  than  the  amount  of 
gold  necessary  to  make  a  gold  dollar.  The  present  discount 
added  to  the  former  premium  shows  a  decline  in  the  value 
of  silver  since  1873,  as  compared  with  gold,  of  about  25  per 
cent.     Labor  and  property  since  that  time  have  depreciated. 


12 

as  compared  with  gold,  more  rapidly  than  silver.  If  silver 
is  finally  demonetized  and  gold  alone  used  as  money,  there 
must  be  a  continual  decline  in  the  price  of  labor  and  prop- 
erty. When  the  world  shall  have  reached  the  gold  standard, 
the  decline  in  prices  will  have  but  just  begun,  for  the  pro- 
duction of  gold  as  compared  with  the  demand,  is  continu- 
ally decreasing.  The  wear,  loss,  use  in  the  arts,  and  the 
increasing  demands  of  commerce,  cannot  be  supplied  from 
the  mines  now  known  to  exist.  The  probabilities  of  new 
discoveries  are  diminisliing  year  by  year  as  the  surface  of 
the  earth  is  more  minutely  examined. 

OPPEESSION  OF  THE  PEOPLE. 

What  will  be  the  condition  of  the  laborer  when  the  money 
of  tlie  world  shall  be  confined  to  gold  alone,  and  when  a 
few  thousand  men  shall  have  the  power  to  require  of  each 
generation  more  than  $100,000,000,000  on  interest  account 
alone  ?  The  contemplation  of  this  vast  sum  to  be  paid  by 
the  producer,  in  connection  with  the  fact  that  gold  is  con- 
stantly decreasing  as  compared  with  population,  suggests  to 
every  right-minded  man  the  necessity  of  immediate  resist- 
ance to  the  bondholder's  demands.  He  must  be  confined  to 
the  terms  of  his  contract.  He  agreed  to  take  either  silver  or 
gold.  He  must  not  be  permitted  to  extort  gold  and  de- 
fraud the  debtor  of  his  right  to  pay  in  silver. 

In  this  great  contest  the  United  States  must  be  the  bat- 
tle-field. In  no  other  country  is  free  discussion  allowed. 
No  other  people  have  the  power  to  resist.  There  is  too 
much  poverty  and  ignorance  in  Europe.  Poverty  and  igno- 
rance always  submit  to  oppression  until  the  point  of  desper- 
ation is  reached.  Then  comes  revolution.  Eevolution  de- 
stroyed the  feudal  system;  it  may  finally  overthrow  the 
bondholding  directory.  The  time  may  come  when  the 
armies  of  Europe  may  take  sides  with  the  starving  popula- 
tion, and  hurl  their  oppressors  from  power,  as  did  the 
people  of  France  when  they  tore  down  the  Bastile,  and  de- 
stroyed feudal  tyranny. 


13 


ARMIES  AND  NAVIES  COLLECT  INTEREST. 

To  fully  appreciate  the  magnitude,  power  and  motives  of 
the  bondholding  directory,  we  must  take  into  consideration 
the  alarming  fact  that  to-day  Europe  is  a  military  camp; 
that  each  of  the  great  Powers  have  from  150,000  to  1,000,000 
men  under  arms,  and  supjDorts,  in  addition  thereto,  a  vast 
navy.  These  military  establishments  serve  several  pur- 
poses: 1.  They  increase  the  national  debts,  and  thereby  fur- 
nish bonds  for  further  investment.  2.  They  increase  taxa- 
tion, and  thereby  make  the  poor  poorer  and  the  rich  richer; 
and,  3.  They  furnish  a  most  effective  instrument  for  the  en- 
forcement of  taxation.  Take,  for  example,  Egypt — a  poor, 
half  civilized  country,  allured  into  contracting  an  enormous 
debt,  which  was  sold  to  speculators  for  from  forty  to  fifty 
cents  on  the  dollar.  These  speculators  well  knew  that  it 
was  impossible  for  the  people  of  Egypt  to  pay  such  a  debt 
without  being  reduced  to  the  most  abject  slavery.  Egypt 
defaulted  in  the  payment  of  interest.  The  ironclads  of  the 
most  civilized  nation  on  earth  razed  Alexandria  to  the  ground 
and  placed  tax-gatherers  over  the  people  to  exact  the  utter- 
most farthing.  To-day  no  laborer  in  Egypt  is  allowed  to  eat 
a  morsel  of  bread  made  from  the  wheat  his  labor  has  pro- 
duced. The  same  oppression  in  kind,  although  perhaps  not 
so  excessive  in  degree,  exists  throughout  Europe, 

THE   MORTGAGE   SYSTEM. 

The  system  now  inaugurated,  and  which  has  supplanted 
the  feudal  system,  may  be  termed  the  "  Mortgage  System." 
It  has  many  advantages.  The  feudal  lord  was  responsible 
for  the  protection,  and,  to  some  extent,  the  maintenance  of 
his  serfs.  The  bondholder  is  free  from  all  responsibility. 
Hundreds  of  ironclads  and  millions  of  armed  men  protect 
him  and  collect  the  interest  on  his  bonds.  With  these  ad- 
vantages the  bondholder  ought  to  be  satisfied;  but  he  is  not. 
He  is  now  scheming  to  make  the  bonded  debt  payable  in 
gold  coin  only.     If  successful,  he  will  increase  more  than 


u 

100  per  cent,  the  hours  of  toil  required  for  the  payment  of 
the  $100,000,000,000  in  interest,  for  which  the  labor  of  each 
generation  is  already  mortgaged.  We  repeat  that  this  fraud 
can  only  be  defeated  in  the  United  States.  The  time  for 
discussion  in  Europe  has  passed.  Nothing  but  a  revolution 
can  affect  the  solid  foundation  of  the  bonded  system  across 
the  Atlantic.  The  armies  and  navies  of  the  great  Powers 
are  already  sufficient  to  suppress  the  nihilist,  communist,  so- 
cialist, and  even  the  great  body  of  the  people,  if  the  divine 
right  of  the  bondholder  is  questioned. 

LEGISLATION  OF   CONGEESS  IN  REGARD  TO  GOLD  AND  SILVER  COIN. 

The  dollar  devised  by  Hamilton  and  authorized  to  be 
coined  by  the  Act  of  April  2,  1792,  consisted  of  416  grains 
of  standard  silver;  fineness,  892  4-10;  equivalent  to  371^ 
grains  of  pure  silver,  with  44f  grains  alloy  of  pure  copper. 
The  weighi  of  the  dollar  was  changed  by  the  Act  of  January 
18,  1837,  to  412^  grains  of  standard  silver;  fineness  changed 
to  900,  preserving  the  same  amount  of  pure  silver — to  wit: 
371^  grains,  with  one-tenth  alloy.  By  both  the  Acts  of  1792 
and  1837,  the  subsidiary  coins — to  wit:  the  half-dollar,  quar- 
ter-dollar, dime  and  half-dime,  had  the  same  proportion  of 
standard  silver  as  the  silver  dollar.  In  1853  the  amount  of 
silver  in  the  subsidiary  coins  was  reduced  by  Act  of  Con- 
gress, and  those  coins  were  declared  to  be  legal  tender  for 
only  $5.  The  dollar  was  not  affected  by  that  Act,  but  re- 
mained the  unit  of  value  and  a  full  legal  tender  until  the 
passage  of  the  Acts  of  1873  and  1874,  hereafter  noticed. 

BONDED  INDEBTEDNESS  OF  THE  UNITED  STATES. 

The  bonds  issued  for  the  suppression  of  the  rebellion  were 
payable  in  lawful  money  or  greenbacks — the  same  kind  of 
money  with  which  the  soldier  was  paid — interest  only  being 
payable  in  coin.  These  bonds  were  sold  for  from  forty  to  fifty 
cents  on  the  dollar  in  coin.  After  peace  was  declared  the 
bondholder  contended  that  one  of  the  inducements  for  his 


15 

investment  was  his  patriotism,  and  that  therefore  he  was 
entitled  to  special  consideration.     Besides,  he  claimed  that 
it  was  generally  understood   that  the  bonds  of  the  United 
States  would  ultimately  be  paid  in  coin.     On  March  18, 
1869  (after  the  first  election  of  President  Grant),  "An  Act 
to  strengthen  the  public  credit"  was  passed,  which  declared 
that  the  bonds  of  the  United  States  were  payable  in  coin. 
This  Act  greatly  enhanced  the  value  of  United  States  bonds, 
and  was  exceedingly  liberal  to  the  bondholders — and   per- 
haps unjust  to  the  people;  but  it  was  fairly  considered,  and 
no  one  is  charged  with  fraudulent  practices  in  securing  its 
passage.    Besides,  the  question  was  submitted  to  the  people 
at  General  Grant's  first  election  in  November,  1868,  and  de- 
cided in  favor  of  paying  the  bonds  in  coin.     Thereafter,  on 
the  14th  day  of  July,  1870,  an  Act  was  passed  "to  authorize 
the  refunding  of  the  national  debt,"  in  which  the  pledge  of 
the  United  States  to  pay  the  debt  in  coin  was  renewed.     It 
was  provided  in  that  Act  that  the  bonds  issued  under  its 
provisions  should  be  redeemable  in  coin  of  the  standard 
value  of  July  14,  1870 — that  is  to  say,  in  gold  dollars  con- 
sisting of  25  8-10  grains  of  standard  gold,  or  in  silver  dollars 
of  412|^  grains  of  standard  silver.     If  the  bondholder  had 
been  honest  he  would  have  been  fully  satisfied  with  the  gen- 
erosity of  the  Government  in  making  its  obligations — which 
were  originally  payable  in  greenbacks — payable  in  coin.    He 
was  not  honest,  and  therefore  he  was  not  satisfied.    As  soon 
as  he  had  secured  the  change  of  his  contract  from  an  agree- 
ment to  pay  greenbacks  to  an  agreement  to  pay  coin,  he  com- 
menced to  connive  with  European  bondholders  to  convert 
his  contract  for  coin  into  a  contract  for  gold  alone.    Through 
inattention    or  some  secret   agency,  the  Acts  of   1873  and 
1874 — demonetizing  silver — were  passed  without  debate  and 
without  the  attention  of  either  House  being  called  to  the 
subject.      The  Government  was  thereby  deprived  of  its  op- 
tion to  pay  its  bonded  obligation  in  either  gold  or  silver. 


16 


THE  STAXDAED  DOLLAR  OMITTED  FROM  THE  LIST  OF  COINS. 

'The  first  assault  upon  the  dollar  of  Hamilton  was  con- 
tained in  a  long  Act  (consisting  of  sixty-seven  sections) 
"revising  and  amending  the  laws  relative  to  the  mints, 
assay-offices  and  coinage  of  the  United  States."  The  Act 
was  approved  February  12,  1873.  The  section  enumerating 
the  silver  coins  in  this  Act  (Section  15)  makes  no  mention  of 
the  silver  dollar,  but  provides  for  what  is  called  a  "  trade 
dollar,' '  to  contain  420  grains  of  standard  silver.  The  object 
of  the  bill,  as  expressed  in  the  title,  was  to  "revise  and  amend 
the  laws  relative  to  the  mints,  assay-offices  and  coinage  of 
the  United  States."  It  was  not  supposed  that  in  such  a  law 
there  would  be  any  radical  change  in  the  laws  of  the  United 
States  with  regard  to  the  use  of  silver  as  money.  The  at- 
tention of  Congress  was  not  called  to  the  fact  that  the  silver 
dollar  was  omitted,  and  this  fact  was  probably  unknown  to 
all  except  those  having  immediate  charge  of  the  bill,  and  if 
known,  it  is  not  at  all  probable  that  the  effect  of  the  law 
would  have  been  understood.  Besides,  neither  gold  nor  sil- 
ver was  in  general  circulation  as  money  in  the  United  States 
at  that  time,  and  the  necessity  of  coining  either  was  proba- 
bly not  regarded  as  very  pressing. 

The  object  of  the  trade  dollar,  provided  for  in  that  Act, 
was  stated  to  be  for  circulation  in  China.  It  was  said  that 
the  standard  dollar  of  412|  grains  was  less  in  weight  than 
the  Mexican  dollar,  which  circulated  in  China,  and  that  our 
trade  with  China  would  be  greatly  benefited  by  coining  a 
dollar  worth  as  much  or  a  little  more  than  the  Mexican  dol- 
lar. It  was  not  pretended  that  the  trade  dollar  was  to  be 
circulated  in  the  United  States. 

The  standard  dollar  was  not,  however,  demonetized  by 
this  Act.  It  was  simply  omitted  from  the  list  of  coins, 
and  this  fact  was  not  observed  or  commented  upon  in  either 
House. 


17 


DEMONETIZATION  OF  THE  STANDARD  DOLLAR. 

The  boDcIholding  directory  was  not  satisfied  with  the  simple 
omission  of  the  standard  dolhir  from  the  list  of  coins,  for  so 
long  as  it  remained  a  legal  tender  to  any  amount,  it  could 
again  be  added  to  the  list  without  any  change  of  the  unit  of 
value  in  the  coins  of  the  United  States.  Its  manipulators, 
therefore,  deemed  it  necessary  to  demonetize  the  standard 
dollar  and  destroy  its  legal  tender  character.  This  was 
surreptitiously  accomplished.  At  the  time  of  the  passage 
of  the  Act  of  February  12,  1873,  the  statutes  of  the  United 
States  were  being  revised  by  a  commission  acting  under  a 
law  which  did  not  authorize  new  legislation,  but  simply 
contemplated  a  codification  and  rearrangement  of  existing 
laws.  Notwithstanding  this  fact,  a  provision  was  inserted 
by  some  unknown  agency,  destroying  the  legal  tender  char- 
acter of  the  standard  dollar.  It  is  in  the  following  lan- 
guage : 

"The  silver  coins  of  the  United  States  shall  be  a  legal 
tender  at  their  nominal  value  for  any  amount  not  exceeding 
$5  in  any  one  payment."  (Revised  Statutes  United  States, 
Sec.  3586.) 

The  Revised  Statutes  of  the  United  States  is  a  very  large 
volume — a  volume  so  large  that  it  was  impracticable  to  read 
it  in  either  House  of  Congress.  In  1874  this  volume  was 
adopted  by  Congress  and  the  reading  dispensed  with  on  the 
assurance  of  the  Commissioners  charged  with  the  duty  of 
codifying  the  laws  that  they  had  inserted  no  new  legislation. 
The  fact^that  Section  3586 — demonetizing  silver — was  in  the 
Revised  Statutes,  was  not  publicly  known  until  a  long  time 
after  the^adoption  of  the  revision. 

THE   PARTIAL   REMONETIZATION    OF    SILVER. 

On  the  28th  of  February,  1878,  an  Act  was  passed  "to 
authorize  the  coinage  of  the  standard  silver  dollar,  and  to 
jrestore  its  legal  tender  character."     This  Act  made  the  sil- 

2 


18 

ver  dollar  a  legal  tender  for  any  amonnt,  and  it  provided 
that  the  Secretary  of  the  Treasury  should  purchase  at  the 
market  price  not  less  than  $2,000,000  nor  more  than  §4,000,- 
000  of  silver  bullion  per  month  for  coinage.  This  was  a 
partial  remonetization  of  silver.  The  Act,  however,  did 
not  authorize  the  owner  of  silver  bullion  to  exchange  it  at 
the  mints  for  coin  on  any  terms,  nor  to  deliver  it  at  the 
Treasury  of  the  United  States  and  receive  silver  certificates 
therefor.  But  notwithstanding  the  refusal  (or  neglect)  of 
the  Treasury  Department  to  execute  this  law  in  good  faith 
(as  we  shall  hereafter  see),  the  further  decline  of  silver  was 
checked  by  the  Act  of  1878,  and  an  upward  tendency  was 
produced  thereby,  which  continued  until  the  war  to  demon- 
etize silver  was  renewed  under  the  present  administration. 
Great  credit  is  due  to  the  zeal  and  patriotism  of  the  mem- 
bers of  Congress  who  passed  this  Act  and  checked  the  evil 
work  of  the  bondholding  directory.  The  names  of  Jones, 
of  Nevada;  Bland,  of  Missouri;  Keagan,  of  Texas;  Warner, 
of  Ohio,  and  their  co-workers,  will  not  be  forgotten.  It  is 
the  only  considerable  victory  which  has  been  won  by  the 
people  against  the  despotic  power  of  money  since  the  bond- 
holder has  assumed  dictatorial  power  in  the  financial  world. 
The  report  of  Senator  Jones,  and  his  great  argument  in  the 
Senate  on  the  passage  of  this  Act,  was  the  first  impartial 
and  philosophical  exposition  of  the  money  question  after 
the  conspiracy  to  demonetize  one  of  the  precious  metals 
was  formed.  His  argument  against  the  demonetization 
of  silver  remains  unanswered.  The  bondholder  now  de- 
mands the  repeal  of  the  Act  of  1878.  But  he  cannot 
succeed  if  the  present  House  of  Representatives  is  com- 
posed of  as  brave  and  patriotic  material  as  the  last.  The 
example  of  the  members  of  the  last  House  who  resisted 
the  President's  demand  for  the  passage  of  a  law  demonetiz- 
ing silver,  furnishes  one  of  the  brightest  pages  of  our  his- 
tory. It  is  difficult  for  a  member  of  Congress  to  refuse  any 
request  from  the  President  of  the  United  States  with  100,- 


19 

000  offices  at  his  disposal;  but  to  refuse  the  request  of  the 
President,  when  that  request  is  reinforced  by  the  power  of 
$75,000,000,000,  is  evidence  of  the  purest  patriotism. 

EESUMPTION   OF   SPECIE   PAYMENT. 

It  has  been  suggested  by  the  attorneys  of  the  bondhold- 
ing  directory  that  the  Act  of  January  14,  1875,  entitled  "An 
Act  to  provide  for  the  resumption  of  specie  payments,"  obli- 
gated the  Government  to  pay  the  bonded  indebtedness  in 
gold.  This  claim  is  as  destitute  of  truth  as  it  is  bold  and 
arrogant.  The  following  extract  from  that  Act  will  show  the 
fallacy  of  the  claim : 

"  And  on  and  after  the  first  day  of  January,  anno  Domini 
eighteen  hundred  and  seventy-nine,  the  Secretary  of  the 
Treasury  shall  redeem,  in  coin,  the  United  States  legal  ten- 
der notes  then  outstanding,  on  their  presentation  for  re- 
demption at  the  office  of  the  Assistant  Treasurer  of  the 
United  States  in  the  City  of  New  York,  in  sums  of  not  less 
than  fifty  dollars.  And  ro  enable  the  Secretary  of  the 
Treasury  to  prepare  and  provide  for  the  redemption  in  this 
Act,  authorized  or  required,  he  is  authorized  to  use  any  sur- 
plus revenues,  from  time  to  time,  in  the  Treasury  not  other- 
wise appropriated,  and  to  issue,  sell  and  dispose  of,  at  not 
less  than  par,  in  coin,  either  of  the  descriptions  of  bonds  of 
the  United  States  described  in  the  Act  of  Congress  approved 
July  fourteenth,  eighteen  hundred  and  seventy,  entitled 
'  An  Act  to  authorize  the  refunding  of  the  national  debt,' 
with  like  qualities,  privileges,  and  exemptions,  to  the  extent 
necessary  to  carry  this  Act  into  full  efiect,  and  to  use  the 
proceeds  thereof  for  the  purposes  aforesaid." 

This  Act  provided  for  the  redemption  of  legal  tender  notes 
(greenbacks) — not  bonds.  The  redemption  was  to  be  made 
in  coin — not  gold  coin.  It  makes  no  difference  whether  or  not 
silver  was  then  demonetized  so  far  as  regards  the  kind  of 
money  in  which  the  .United  States  bonds  are  to  be  paid. 
It  is  expressly  provided  in  the  part  of  the  Act  above  quoted 
that  the  bonds  which  are  therein  authorized  to  be  sold  to 
obtain  coin  with  which  to  resume  specie  paj^nents  were  to 


20 

be  issued  under  the  provisions  of  the  Act  of  July  14,  1870. 
We  have  already  seen  that  all  bonds  issued  under  the  pro- 
visions of  that  Act  may  be  redeemed  in  silver  dollars  con- 
sisting of  412|  grains  of  standard  silver,  if  the  Government 
elects  to  pay  them  in  that  kind  of  coin.  After  the  passage 
of  the  Kefunding  Act  of  July  14,  1870,  it  was  the  duty  of 
the  Government  to  provide  gold  and  silver  dollars  of  the 
standard  value  of  that  date  with  which  to  redeem  the  bonds 
issued  under  that  Act.  If  gold  and  silver  had  both  been 
demonetized  and  paper  substituted  therefor,  does  any  one 
pretend  that  it  would  not  liave  been  right  and  proper  for 
the  United  States  to  coin  gold  and  silver  dollars  to  be  used 
in  payment  of  the  bonds  according  to  the  terms  of  the  law 
under  which  they  w-ere  issued  ?  Why  is  it  not  both  the 
right  and  duty  of  the  Government  to  continue  the  coinage 
of  silver  dollars  for  the  purpose  of  complying  with  its  obli- 
gation to  pay  the  bondholder  in  silver  ?  If  silver  were  the 
dearer  metal  the  bondholders  would  demand  its  coin- 
age. It  being  the  cheaper  metal,  why  may  not  the 
people  demand  that  it  be  coined  and  used  in  the  discharge 
of  all  Government  obligations  which  are  payable  in  silver  ? 
We  maintain  that  when  the  bondholder  is  paid  in  silver  for 
a  debt  originally  contracted  in  greenbacks,  he  will  receive 
more  than  he  contracted  for;  but  whether  the  bondholder 
was  benefited  or  not  by  exchanging  a  contract  payable  in 
greenbacks  to  a  contract  payable  in  coin,  is  immaterial  for 
the  purposes  of  this  argument.  The  question  now  is:  Shall 
the  rights  of  the  bondholders  and  of  the  people  be  adjusted 
according  to  the  existing  contract,  or  shall  the  contract  be 
again  changed  for  the  purpose  of  enhancing  the  value  of 
bonds?  We  advise  the  bondholder  to  pause  and  reflect  be- 
fore he  again  departs  from  the  letter  of  his  contract, 
and  attempts  to  obtain  more  than  is  named  in  the  bond. 
If  he  does  not  stop  tampering  with  contracts  between 
himself  and  the  people,  the  question  may  arise:  What  moral 
right  has  one  generation  to  mortgage  the  services  of  the  next  ? 


2i 

African  slavery  was  guarded  and  protected  by  as  perfect  a 
framework  of  constitutions  and  laws  as  huinan  ingenuity  could 
invent.  It  was  abolished  by  the  sword,  without  compensa- 
tion to  the  owners  of  slaves.  The  $75,000,000,000  of  bonded 
indebtedness  rests  upon  contracts  no  move  zealously  guarded 
by  law  than  the  title  of  the  American  planter  to  the  African 
slave.  It  will  not  do  to  so  increase  the  difficulties  of  paying 
the  bonded  debt  as  to  involve  the  enslavement  of  the  pro- 
ducer, for  in  that  event  there  may  be  a  demand  for  an 
equitable  adjustment  of  contracts  that  will  disturb  the 
peace  of  society.  Is  the  bondholder  prepared  to  ad- 
just equities  with  the  laborer  ?  Dare  he  say  to  the  poor- 
est laborer  in  Christendom :  ' '  You  and  I  were  born  equal, 
and  neither  of  us  ought  to  enjoy  of  this  world's  goods  more 
than  the  labor  of  his  hands  has  produced,  and  we  will  adjust 
our  equities  on  that  basis  ?"  The  whole  superstructure  of 
the  bondholder's  power  rests  upon  the  strict  adherence  to 
the  letter  of  the  contract.  We,  therefore,  warn  him  to  abide 
by  the  terras  of  his  contract,  for  if  equities  are  invoked,  the 
luxuries  which  he  now  enjoys  may  be  exchanged  for  pov- 
erty and  toil.  We  especially  warn  him. to  proceed  no  fur- 
ther in  his  attempt  to  convert  existing  contracts  payable  in 
either  gold  or  silver  into  contracts  payable  in  gold  alone,  or 
the  laboring  classes  may  demand  an  adjustment  of  equities, 
which  he  will  have  no  power  to  deny. 

NATIONAL   BANKS. 

The  national  bankers,  at  a  convention  held  at  Chicago  on 
September  23d  last,  passed  the  following  resolution : 

^'Resolved,  That  it  is  the  sense  of  the  convention  that  the 
coinage  of  the  silver  dollars,  under  the  compulsory  law  of 
1878,  is  detrimental  to  the  best  interests  of  the  people  and 
dangerous  to  the  welfare  of  the  Government,  and  that  the 
law  should  be  immediately  suspended,  and  remain  inopera- 
tive until  an  international  agreement  of  the  leading  commer- 
cial nations  shall  give  substantial  assurance  as  to  the  future 
relation  of  gold  and  silver  as  money." 


22 


lu  other  words,  the  national  bank  managers  resolved  that 
silver  should  be  demonetized  until  the  European  bondhold- 
ing  directory  should  otherwise  dictate.  The  cool  assurance 
which  these  bankers  assume  in  pretending  to  advocate  the 
best  interests  of  the  people  and  the  Government  leads  to  the 
inquiry  as  to  who  they  are  and  what  they  represent.  If,  on 
investigation,  it  shall  appear  that  they  are  subsidized  monop- 
olists and  allies  of  European  bondholders,  their  advice  may 
not  be  regarded  as  valuable  unless  supported  by  argument. 

This  favored  class  came  into  existence  in  the  following 
manner:  Greenbacks  drawing  no  interest  were  in  circulation 
as  money.  The  Government  was  induced  to  issue  interest- 
bearing  bonds,  and  purchase  and  retire  therewith  a  large 
amount  of  the  greenbacks  then  in  circulation — say  $400,000,- 
000.  This  created  an  excuse  for  issuing  other  paper  to  sup- 
ply the  deficiency  created  by  the  retirement  of  the  green- 
backs. The  national  banks  were  allowed  to  deposit  in  the 
Treasury  the  bonds  of  the  United  States  issued  to  retire  the 
greenbacks  and  draw  interest  thereon;  and  in  addition 
thereto  the  Government  furnished  the  national  banks,  free 
of  charge,  the  use  of  paper  money  issued  by  the  Government 
and  called  "National  Currency,"  to  the  extent  of  ninety 
cents  on  the  dollar  of  the  amount  of  bonds  deposited.  The 
Government  thereby  succeeded  in  substituting  one  kind  of 
paper  money,  called  ''National  Bank  Notes,"  for  another 
kind  of  paper  money,  commonly  called  "Greenbacks" — 
both  resting  for  validity  upon  the  credit  of  the  United  States. 
This  change  has  cost  the  Government  from  $12,000,000  to 
$15,000,000  in  interest  annually  for  the  last  twenty  years.  In 
order  to  justify  the  change  and  show  that  national  bank  notes 
are  better  than  greenbacks,  the  advocates  of  the  national 
banks  would  have  us  believe  that  money  issued  and  guar- 
anteed by  the  United  States  is  not  money  until  it  is  reissued 
by  some  person  calling  himself  a  "National  Banker,"  and 
that  the  credit  of.  the  United  States  is  so  bad  that  it  can  only 
issue  money  through  a  stranger,  who  might  be  termed  either 


John  Doe  or  Richard  Eoe.  Although  the  holders  of  green- 
backs have  had  the  privilege  for  more  than  ten  years  of 
exchanging  them  for  coin,  there  are  now  in  circulation, 
on  a  par  with  gold,  about  $360,000,000  of  that  kind  of 
currency.  It  has  always  been  difficult  for  the  national 
banks  to  explain  why  the  United  States  retired  green- 
backs drawing  no  interest,  and  substituted  therefor  national 
bank  notes  at  so  great  a  sacrifice.  Many  people  now  be- 
lieve that  there  is  no  satisfactory  reason  why  green- 
backs should  not  be  reissued  and  exchanged  for  bonds, 
and  the' $324, 000, 000  of  national  currency  retired.  Would  it 
not  be  well  for  the  national  bank  manipulators  to  furnish  a 
good  reason  for  their  own  existence  before  they  attempt  to 
destroy  silver?  Can  any  satisfactory  reason  be  given  why 
silver  should  not  be  remonetized  and  again  received  at  the 
mints,  and  certificates  guaranteed  by  the  Government  issued 
therefor?  Why  should  not  such  certificates,  guaranteed  by 
the  Government  and  secured  by  the  deposit  of  silver  bullion 
be  as  good  money  as  national  bank  notes  with  no  security 
or  guarantee  other  than  the  credit  of  the  United  States? 
Have  the  national  banks  any  other  objection  to  the  use  of 
silver  than  the  fact  that  its  remonetization  and  the  issuance 
of  silver  certificates  based  on  the  deposit  of  bullion  would 
supersede  the  necessity  of  national  bank  notes?  The  reso- 
lutions of  these  national  bank  managers  must  be  read  in  the 
light  of  the  fact  that  it  is  worth  more  than  §12,000,000  a  year 
to  them  to  prevent  the  retirement  of  the  national  bank  notes 
by  substituting  therefor  either  silver  coin  or  silver  certificates. 
It  must  also  be  remembered  that  the  correspondents  of 
these  national  banks  in  Europe  are  controlled  by  the  bond- 
liolding  directory,  and  that  the  financial  credit  of  these 
American  banks  depends  upon  the  fidelity  with  which  they 
serve  the  great  financial  operators  who  control  and  direct 
the  policy  of  the  bondholders.  There  are  about  twenty- 
seven  hundred  national  banks,  which  are  always  ready  on 
"call"  to  furnish  the  managers  of  the   lobby  such  a  per- 


24 

centage  of  the  $12,000,000  subsidy  which  tliej  receive  from 
the  United  States  aunuall}^  as  may  be  required  to  perpetuate 
their  power.  The  combination  of  these  national  banks  and 
European  bondholders  is  indeed  formidable,  and  threatens 
the  liberties  of  the  people  of  the  United  States.  But  there  is 
no  doubt  that  the  people  will  finally  triumph  against  na- 
tional banks  and  bondholding  syndicates  as  they  did  in  the 
time  of  Jackson,  when  a  less  objectionable  institution  called 
the  United  States  Bank  was  throttled  and  destroyed. 

We  do  not  object  to  bankers  any  more  than  we  do  to 
shoemakers,  merchants,  or  mechanics  of  any  kind.  It  is 
the  subsidy  to  which  we  object.  In  proof  that  a  subsidy  is 
no  more  necessary  in  the  banking  business  than  in  any 
other,  we  call  attention  to  the  fact  that  the  principal  com- 
mercial banks  of  the  Pacific  Coast  do  business  on  their  own 
money,  without  subsidies,  and  their  financial  standing  is  as 
good  as  any  banks  in  the  United  States. 

CONGEESS  TO  EEGULATE  THE  VALUE  OF  MONEY. 

The  Constitution  of  the  United  States  provides  that 
"Congress  shall  have  power  *  '^  ^  to  coin  money  and 
regulate  the  value  thereof. "  Under  this  provision  the 
United  States  continues  to  some  extent  to  coin  money,  but 
does  not  regulate  its  value.  It  is  true  that  the  units  of 
value  of  the  coins  of  the  United  States  are  called  dollars, 
and  that  a  gold  dollar  contains  25  8-10  grains  of  stand- 
ard gold,  and  a  silver  dollar  412J  grains  of  standard 
silver.  But  this  does  not  determine  the  value  of  the  coin. 
The  value  of  each  dollar  (as  we  have  already  seen)  is  deter- 
mined by  the  number  of  dollars  in  use  in  the  United  States, 
and  not  by  the  quality  or  quantity  of  the  material  of  which 
the  dollar  is  made.  The  amount  of  material  to  make  a  sil- 
ver dollar  is  worth  twenty-one  per  cent.  less  than  the  amount 
of  material  necessary  to  make  a  gold  dollar,  and  the  mate- 
rial necessary  to  make  a  paper  dollar — whether  that  paper 
dollar  be  greenback  or  national  currency — is  comparatively 


25 


nothing;  and  yet  each  of  these  dollars  has  the  same  pur- 
chasing power.  If  the  present  circulating  medium — con- 
sisting of  national  currency,  greenbacks,  silver  and  gold 
dollars — were  doubled  by  the  issue  of  gold  or  silver,  green- 
backs or  national  currency,  the  value  of  each  dollar  now  in 
circulation  would  be  reduced  about  one-half.  This  would 
be  unfair  to  the  creditor  class,  but  it  would  be  no  more  un- 
fair than  the  demonetization  of  silver  would  be  to  the  debtor 
class.  It  is  the  duty  of  Congress  to  regulate  the  value  of 
money  so  that  neither  the  debtor  nor  the  creditor  can  be 
robbed  by  violent  contraction  or  expansion. 

NEW  YOEK  CITY . 

It  is  not  surprising  that  New  York  City  should  be  opposed 
to  silver.  Its  business  relations  with  the  bondholdiug  syn- 
dicate of  Europe  are  exceedingly  intimate.  It  deals  in  se- 
curities, imports  foreign  goods  and  apes  foreign  manners. 
Many  of  its  business  houses  are  either  branches  of  European 
establishments  or  are  so  connected  with  the  business  of 
Europe  as  to  be  under  the  immediate  influence  of  the  bond- 
holding  directory.  The  people  of  the  United  States  cannot 
submit  to  dictation  from  either  New  York  or  Europe.  They 
must  have  an  independent  financial  policy  of  their  own. 
Civil  liberty  cannot  survive  financial  slavery.  It  may  take 
time  for  the  people  to  comprehend  the  designs  of  Europe 
on  the  liberty  of  this  country,  but  sooner  or  later  the 
money  question  will  be  understood.  The  metropolitan 
press  may,  for  a  time,  mislead  good  men,  but  if  the  fraudu- 
lent practices  of  European  bondholders  are  continued  much 
longer  in  this  country,  the  day  of  retribution  will  shake  the 
foundations  of  society.  Let  it  now  be  averted  by  an  honest 
observance  of  the  obligation  of  contracts. 

WHY  SILVER  DOES  NOT  CIRCULATE, 

The  reason  why  silver  does  not  circulate  freely  is  because 
the  Treasury  officials  refuse  to  obey  the  law  and  put  it  in 


26 


circulation.  Although  the  bonded  indebtedness  of  the 
United  States^both  principal  and  interest — is  payable  in 
silver,  not  a  dollar  of  that  metal  has  been  paid  in  liquida- 
tion of  the  public  debt.  On  the  contrary,  in  July  last,  the 
Treasury  Department,  according  to  its  long-established  pol- 
icy, borrowed  of  the  national  banks  of  New  York,  through 
the  clearing  house  of  that  city,  $6,000,000  in  gold,  and  issued 
fractional  currency  therefor.  The  excuse  given  for  this  re- 
markable transaction  was  to  strengthen  the  Federal  Govern- 
ment's gold  reserve,  and  to  furnish  it  with  gold  to  pay  in- 
terest on  the  national  debt.  It  is  a  remarkable  fact  that 
while  the  Secretary  of  the  Treasury — himself  recently  a 
national  banker — was  supplicating  his  fellow  national  bank- 
ers to  save  the  Government  of  the  United  States  from  bank- 
ruptcy by  the  loan  of  §6,000,000,  the  Treasury  was  over- 
flowing with  silver  applicable  to  the  payment  of  the 
principal  and  interest  of  the  public  debt.  If  the  Secre- 
tary of  the  Treasury  could  have  been  induced  to  regard  the 
Acts  of  Congress  with  some  respect,  he  would  not  have  felt 
himself  compelled,  at  the  dictation  of  any  bondholdiug  syn- 
dicate to  allow  silver  to  lie  idle  in  the  vaults  of  the  Treasury, 
and  to  complain  of  want  of  storage  room  for  that  money, 
while  there  was  a  demand  for  it  for  the  payment  of  interest 
on  United  States  bonds.  It  is  to  be  regretted  that  so 
many  members  of  Congress  and  Treasury  officials  have 
been  connected  with  national  banks.  If  a  Secretary  of  the 
Treasury,  free  from  relations  or  complications  with  national 
banks  or  bondbolding  syndicates,  could  be  appointed,  there 
might  be  some  hope  that  the  laws  of  Congress  would  be  en- 
forced. It  can  hardlj'  be  expected,  however,  that  any  person 
interested  in  a  national  bank  or  connected  with  those  syndi- 
cates will  be  able  to  impartially  administer  the  laws  of  Con- 
gress regulating  the  currency  of  the  United  States. 

CREDIT   OF   THE   UNITED   STATES. 

We  hear  much  from  Treasury  officials  about  preserving 
the  sacred  credit  of  the  United  States.     This  is  all  sham. 


27 


The  credit  of  the  United  States  is  already  too  good.  Bonds 
upon  which  the  Government  realized  only  forty  per  cent,  and 
has  paid  more  than  an  hundred  cents  on  the  dollar  in  iuterest, 
are  to-day  selling  for  120  cents — an  advance  of  200  per  cent. 
This  results  in  part  from  the  restoration  of  peace  and  the 
growth  and  prosperity  of  the  country,  but  i^rincipally  from 
the  various  changes  in  the  contract  between  the  Government 
and  its  creditors, produced  by  legislation  and  the  refusal  of  the 
Treasury  officials  to  obey  the  law.  Bonds  payable  in  green- 
backs (as  we  have  already  seen)  were  made  payable  by  Act 
of  Congress  in  coin.  Bonds  payable  in  either  gold  or  silver 
are  paid  b}'^  Treasury  officials  in  gold  alone,  thereby  creating 
an  extraordinary  demand  for  gold  and  enhancing  its  price, 
and  depreciating  silver.  Nothing  but  a  gross  violation  of 
law  and  a  partiality  for  bondholders  could  induce  the  Secre- 
tary of  the  Treasury  to  refuse  to  pay  bonds  in  silver  when 
the  law  so  provides,  and  when  the  people  would  be  benefited 
thereby.  How  dare  any  Secretary  of  the  Treasury  give  to 
the  bondholder  twenty  to  twenty-five  per  cent,  more  than 
the  law  requires  ?  Why  should  not  the  credit  of  the  United 
States  be  good  when  the  Government  is  made  to  pay  three 
times  as  much  as  it  agreed  to  pay  ?  Our  national  debt  at  the 
close  of  the  war  was,  in  round  numbers,  $2,800,000,000-^$!,- 
000,000,000  of  which  has  been  paid.  The  remaining  $1,800,- 
000,000  is  more  than  double  the  amount  of  the  $2,800,000,000 
as  it  existed  at  the  close  of  the  war,  if  measured  by  days  of 
labor,  bushels  of  wheat  or  bales  of  cotton.  If  the  Treasury 
officials  are  not  required  to  obey  the  law,  but  may  pay  the 
bondholder  as  much  as  they  please  and  in  any  kind  of  money 
they  choose,  the  United  States,  with  its  boasted  resources, 
may  never  be  able  to  liquidate  the  national  debt.  Since 
1865  to  the  present  time,  for  every  dollar  paid  on  the  prin- 
cipal of  the  national  debt  two  dollars  have  been  added  by 
manipulation.  Is  it  not  time  that  the  people  were  informed 
•of  the  practices  by  which  financial  robbery  is  conducted 
wholesale  at  their  expense  ? 


28 


WHAT   LEGISLATION   IS   WANTED. 


If  Congress  would  authorize  the  Treasury  Department  to 
receive  all  silver  bullion  offered  at  the  rate  of  41 2|  grains  of 
standard  silv6r  for  a  dollar,  in  exchange  for  coin  or  silver 
certificates  at  the  option  of  the  Government,  and  retain  the 
bullion  so  received  as  security  for  the  certificates  issued 
therefor,  and  make  such  certificates  a  full  legal  tender  for 
all  purposes  and  to  any  amount,  silver  would  be  remone- 
tized,  and  the  currency  of  the  United  States  would  be  placed 
on  a  solid  metallic  basis.  If,  however,  this  cannot  be  done, 
let  the  present  law  be  executed.  By  the  Act  of  1878  the 
Secretary  of  the  Treasury  is  authorized  to  invest  $4,000,000 
a  month  in  the  purchase  of  silver  bullion.  Let  him  pur- 
chase the  full  amount  each  month,  coin  it,  and  pay  it  out 
for  public  dues.  If  the  people  do  not  like  silver  dollars  they 
need  not  use  them.  Silver  coin  can  now  be  converted  into 
silver  certificates  at  the  option  of  the  owner.  Persons  having 
silver  coin  may  deposit  it  in  the  Treasury  and  receive  certifi- 
cates therefor,  which  are  "receivable  for  customs,  taxes  and 
all  public  dues."  No  one  receiving  silver  coin  from  the 
Government  need  move  it  from  the  vaults  of  the  Treasury. 
He  can  change  it  before  it  is  removed  or  at  any  time  thereaf- 
ter for  paper,  which  is  on  a  par  with  gold.  While  it  would  be 
better  to  coin  no  more  silver  than  the  necessities  of  com- 
merce require,  and  issue  certificates  on  bullion  as  well  as 
coin,  still,  in  the  absence  of  the  necessary  legisla- 
tion for  that  purpose,  the  Government  must  bear  the 
expense  of  coinage  until  a  law  can  be  passed  for  the 
issuance  of  certificates  on  uncoined  bullion.  A  Sec- 
retary of  the  Treasury  who  would  act  in  the  interests 
of  the  people,  and  who  was  under  no  obligations  to  bond- 
holders, could,  in  a  very  short  time,  under  the  existing 
law,  put  silver  on  a  par  with  gold.  The  investment  of 
$4,000,000  a  month  in  silver  bullion  would  soon  exhaust 
the  surplus  in  the  market,  and  create  such  a  demand  for 
silver  as  to  advance  it  to  par  with  gold.     The  present  produc- 


29 

tiou  of  silver  is  not  in  excess  of  the  demand  from  India  and 
China.  The  additional  demand  Avhich  would  be  created  by 
the  investment  of  $4,000,000  a  month,  instead  of  12,000,000, 
in  the  purchase  of  silver  bullion,  with  the  avowed  purpose 
on  the  part  of  the  United  States  to  remonetize  it,  would 
settle  the  question  in  favor  of  silver  as  money.  If  the  bond- 
holders were  paid  in  silver,  they  would  become  interested  in 
appreciating  it.  It  would  then  become  their  money,  and 
they  would  not  hire  newspapers  to  give  it  a  bad  name.  Be- 
sides, the  prompt  payment  of  Government  dues  in  silver  to 
the  extent  of  the  full  amount  that  could  be  coined  from 
$4,000,000  a  month  worth  of  bullion  would  put  in  circula- 
tion about  $50,000,000  a  year  of  silver  coin  or  certificates. 
Fifty  million  dollars  a  year  of  coin  or  silver  certificates 
■would  take  the  place  of  the  hot-house  plants  called  national 
bank  notes,  as  fast  as  the  bonds  upon  which  they  are  issued 
can  be  paid  and  retired.  This  would  avoid  any  more  special 
or  class  legislation  to  put  out  or  keep  out  the  national  bank 
notes. 

NO  COMPROMISE. 

The  advocates  of  bi-metallic  money  must  consent  to  no  com- 
promise. Silver  must  be  either  fully  remonetized  or  the 
present  law  enforced.  The  people  are  not  suflaciently  versed 
in  intrigue  to  cope  with  the  bondholding  directory  in  the 
construction  of  doubtful  laws.  Every  doubtful  expres- 
sion in  any  law  will  be  construed  in  favor  of  the  bond- 
holders. The  proposition  known  as  the  Warner  Bill  has 
much  to  commend  it,  but  the  difiiculty  is  that  many  of  its 
provisions  are  subject  to  construction,  and  that  the  Treasury 
Department  must  execute  it.  The  influence  of  the  bond- 
holding  directory  in  that  Department  must  not  be  over- 
looked. If,  according  to  the  general  plan  of  the  Warner 
Bill,  the  Government  would  receive  in  good  faith  all  silver 
bullion  ofi'ered  at  the  market  price,  on  the  day  of  the  offer, 
in  exchange  for  coin  or  certificates,  which  should  be  a  full 
legal  tender  for  every  purpose,  and  to  any  amount,  and  re- 


30 

tain  on  deposit  the  bullion  so  received  as  security  for  such 
certificates,  and  the  Treasury  officials  would  execute  such 
a  law,  silver  would  be  fully  remonetized,  and  would  be  very 
soon  placed  on  a  par  with  gold  at  the  ratio  now  established. 
The  difference  between  the  receipt  of  bullion  by  the  United 
States  at  the  rate  of  412|  grains  of  standard  silver  for 
a  dollar  and  its  receipt  at  its  market  value  in  gold,  so  far 
as  ultimate  results  are  concerned  (if  such  a  law  could  be 
executed),  is  more  imaginary  than  real.  The  receipt  by  the 
United  States  of  all  silver  bullion  offered  on  either  plan  would 
make  an  unlimited  market  for  silver,  which  would  place  it 
on  a  par  with  gold  according  to  the  ratio  of  15  98-100  to  1 
before  the  United  States  could  possibly  obtain  the  amount 
necessary  to  meet  the  increasing  demand  for  a  circulating 
medium.  If,  however,  silver  should  be  received  at  its  mar- 
ket value  in  gold,  it  would  be  necessary  to  limit  the  price 
and  provide  that  no  higher  price  should  be  paid  for  silver 
in  exchange  for  coin  or  certificates  than  the  ratio  of  15  98- 
100  to  1,  or  silver  would  rise  above  that  ratio. 

THE  SUBSTITUTION  OP  CARTWHEELS  FOR  DOLLARS. 

The  mosb  dishonest  and  insidious  proposition  that  has 
been  suggested  is  to  increase  the  amount  of  silver  requisite 
to  make  a  silver  dollar.  It  is  suggested  by  some  that  the 
silver  dollar  should  be  composed  of  1:80  grains  instead  of 
412|  grains.  It  is  also  suggested  that  no  more  dollars 
shall  be  coined,  but  that  half  dollars,  consisting  of 
240  grains  each,  should  be  coined  after  this  change  shall 
have  been  made.  It  is  argued  that  half  dollars  of 
that  size  will  not  be  as  cumbersome  as  the  present  dollar 
of  412|  grains.  The  frigid  impudence  of  either  of  these 
propositions  would  be  surprising  if  we  were  not  accustomed 
to  the  demands  of  the  boudholdiug  directory  to  change  the 
basis  of  their  contracts  with  the  people  at  pleasure.  The 
bondholders,  as  we  have  already  seen,  have,  by  their  agents 
in  Europe,  and  in  the  Treasury  Department  of  the  United 


31 

States,  depressed  the  value  of  silver  about  twenty-five  per 
cent,  as  compared  with  gold,  and  they  now  propose  to  make 
it  equal  to  gold  by  adding  more  silver.  When  this  is  done, 
they  will  again  depreciate  the  value  of  silver  by  their  manip- 
ulations, and  add  more  silver,  until  a  silver  dollar  will 
be  as  lai"^e  as  a  cartwheel,  silver  mining  stopped,  and  silver 
demonetized  by  this  cuttle-fish  process. 

If  the  remonetization  of  silver,  or  the  enforcement  of 
existing  laws,  should  result  in  the  retirement  of  the  national 
banks  and  the  relief  of  the  Treasury  of  its  idle  surplus 
revenue  in  the  redemption  of  the  bonds  upon  which  the 
national  bank  notes  were  issued,  no  honest  man  ought  to 
complain.  The  readjustment  on  the  original  basis  of  the 
contract  between  the  bondholder  and  the  people  is  certainly 
desirable.  The  extortion  contemplated  by  the  demonetiza- 
tion of  silver  must  be  prevented  by  restoring  that  metal  to 
its  original  place.  Nothing  short  of  that  will  satisfy  the 
people. 

Let  it  not  be  supposed  that  any  person  not  holding  a  bond, 
the  payment  of  which  is  absolutely  secure,  can  be  benefited 
by  contraction.  Even  the  money-lender  suffers  with  the 
balance  of  the  community.  The  rate  of  interest  declines, 
and  money  flows  to  financial  centers  and  remains  idle  for 
want  of  confidence  and  good  security,  and  also  because 
prudent  men  will  not  borrow — that  is,  sell  money  "  short" — 
while  it  is  increasing  in  value. 

In  conclusion  we  ask :  Why  should  entei"prise  be  crushed, 
the  laborer  thrown  out  of  employment,  and  gloom  and 
misery  be  spread  over  the  land  to  satisfy  the  selfish  greed 
of  the  bondholder?  Let  the  arrogant  bondholder  take  warn- 
ing from  history.  Revolution  and  repudiation  are  written 
on  all  its  pages.  Oppression  in  the  end  destroys  the  op- 
pressor as  well  as  the  oppressed.  The  only  absolute  secur- 
ity of  the  bondholder  is  general  prosperity.  No  prosperity 
can  exist  with  a  decreasing  circulating  medium.  Contrac- 
tion means  all  of  the  misfortunes  that  can  happen  to  civilized 


32 

society  concentrated  in  a  single  word.  Stagnation,  bank- 
ruptcy, idleness,  starvation,  crime  and  misery  are  the  legiti- 
mate offspring  of  a  decreasing  circulating  medium;  wbile, 
on  the  other  hand,  prosperity,  employment,  abundance, 
obedience  to  law  and  happiness  follow  a  suflScient  circu- 
lating medium  as  naturally  and  as  regularly  as  good  crops 
follow  generous  rains  and  favorable  weather,         ^ 

WM.  M.  STEWAKT. 

Carson  City,  Nev.,  November  27,  1885. 


SUPPLEMENT 


COMMENTS   ON    PRESIDENT'S   MESSAGE   ON    THE 
SILVER  QUESTION. 


Since  the  foregoing  pages  were  printed,  the  President's 
message  has  been  received.  That  remarkable  document 
contains  all  the  arguments  that  Manton  Marble  was  able  to 
import  from  Europe,  and  all  the  sophistry  that  the  managers 
of  the  national  banks  could  invent  in  America.  It  boldl\ 
recommends  the  repeal  of  the  Act  of  1878,  and  the  utter  de- 
monetization of  silver. 

DOES   AN   INCREASE   OF   COINAGE    PRODUCE   CONTRACTION? 

The  President  admits  the  disastrous  effects  of  a  decreasing 
circulating  medium,  but  boldly  utters  the  manifest  paradox 
that  the  coining  of  money  produces  contraction.  In  other 
words,  the  more  coin  the  more  contraction.  The  President 
says: 

"Those  who  do  not  fear  any  disastrous  consequences 
arising  from  the  continued  compulsory  coinage  of  silver  as 
now  directed  by  law,  and  who  suppose  that  the  addition  to 
the  currency  of  the  country  intended  as  its  result  will  be 
a  public  benefit,  are  reminded  that  history  demonstrates 
that  the  point  is  easily  reached  in  the  attempt  to  float  at  the 
same  time  two  sorts  of  money  of  different  grades  of  excel- 
lency, when  the  better  will  cease  to  be  in  circulation.  The 
hoarding  of  gold,  which  has  already  taken  place,  indicates 
that  we  shall  not  escape  the  usual  experience  in  such  cases. 
So,  if  this  silver  coinage  be  continued,  we  may  reasonably 
expect  that  gold  and  its  equivalent  will  abandon  the  field  of 
circulation  to  silver  alone.  This,  of  course,  must  produce 
a  severe  contraction  of  our  circulating  medium,  instead  of 
adding  to  it." 


34 

If  the  President  would  inform  us  where  to  find  the  history 
which  demonstrates  that  an  increased  coinage  of  silver  ever 
produced  contraction,  we  might  be  able  to  verify  the  truth 
of  his  statement. 

SILVER   HAS    NOT   DRIVEN   GOLD   FROM   THE   COUNTRY. 

If  the  presence  of  inferior  grades  of  money  produce  con- 
traction, the  retirement  of  such  inferior  grades  ought  to  pro- 
duce inflation.  If  this  be  so,  why  not  retire  greenbacks, 
national  bank  notes  and  standard  silver  dollars,  and  have 
an  abundance  of  money  at  once  ?  There  must  be  some  de- 
fect iu  the  President's  historical  demonstration  as  applied 
to  the  present  age,  for  our  experience  is  contrary  to  the 
President's  history.  Greenbacks,  national  bank  notes  and 
silver  coin  have  been  in  circulation  for  several  years. 
Have  they  contracted  the  currency?  They  certainly  have 
not  thus  far  driven  gold  out  of  the  country.  On  the  con- 
trary, the  amount  of  gold  in  circulation  has  constantly  in- 
creased since  the  passage  of  the  Act  of  1878  providing  for 
the  coinage  of  the  silver  dollar. 

In  1878  the  gold  and  silver  coins  of  the  United  States 
amounted  to  about  $380,000,000.  On  July  1,  1885,  accord- 
ing to  the  report  of  the  Director  of  the  Mint,  the  gold  and 
silver  coins  in  the  United  States  (including  bullion  in  the 
mints  and  assay-offices  for  coinage)  amounted  to  $891,501,- 
682 — making  an  increase  of  about  $510,000,000.  Between 
February  28,  1878,  and  July  1,  1885,  the  amount  of  silver 
was  increased  by  coinage  by  about  $210,000,000.  Deducting 
the  increase  of  silver  from  the  total  increase  of  both  gold 
and  silver,  shows  an  increase  of  gold  in  the  United  States 
of  about  $300,000,000  since  the  passage  of  the  Act  of  1878 — 
an  average  increase  of  about  $3, 448 ,000  a  month. 

THE   CONSPIRATORS  TAKE  ADVANTAGE  OF    THEIR   OWN  WRONG. 

The  argument  against  silver,  founded  on  its  present  de- 
preciated value  as  compared  with  gold,  is  unfair.     It  is  an 


35 

attempt  on  the  part  of  the  enemies  of  silver  to  take  advan- 
tage of  their  own  wrong.  When  the  war  on  silver  com- 
menced, the  amount  of  silver  necessary  to  make  a  silver 
dollar  (as  before  stated)  was  Avorth  three  cents  more  than 
the  amount  of  gold  required  to  make  a  gold  dollar.  The 
combined  power  of  $75,000,000,000  of  bonds  and  twenty- 
seven  hundred  national  banks  has  depressed  the  market 
value  of  silver,  as  compared  with  gold,  more  than  25  per 
cent.  The  active  co-operation  of  the  President  and  his 
advisers  with  the  bondholders  and  the  national  banks  has 
depressed  the  market  value  of  silver  since  the  4th  of  March 
last  as  much  as  5  per  cent.  The  President  now  points  to  the 
difference  in  the  market  value  of  silver  and  gold,  produced 
by  himself  and  the  powers  he  serves,  as  a  reason  why  there 
should  be  no  further  opposition  to  the  utter  demonetization 
of  silver,  and  tlie  final  consummation  of  a  crime  against  civ- 
ilization which  will  entail  burdens  upon  the  people  too 
grievous  to  bear. 

CONTEACTION    AND     THE     EFFORT     TO    DEMONETIZE     SILVER    THE 
CAUSE   OF   HARD   TIMES. 

It  is  true  that  enterprise  is  at  a  standstill,  and  that  indus- 
try is  paralyzed  and  millions  are  unemployed.  What  has 
caused  this  deplorable  state  of  affairs?  It  is  not  inflation,  be- 
cause now  is  a  time  of  contraction.  According  to  the  "Amer- 
ican Almanac"  for  1885,  there  was  an  increase  of  the  amount 
of  money  in  actual  circulation  among  the  people,  between 
November  1,  1879.  and  November  1,  1882,  of  about  $118,-  . 
000,000.  This  increase  substantially  corresponded  with  the 
ratio  of  increase  of  population,  and  it  was  a  period  of  great 
prosperity.  From  November  1,  1882,  to  November  1,  1884, 
there  was  a  decrease  in  the  currency  in  circulation  among 
the  people  of  about  $45,000,000.  The  decrease  in  the  circu- 
lation from  November  1, 1884,  to  November  1,  1885,  we  have 
no  means  of  accurately  stating,  but  we  know  it  was  much 
greater  than  in  any  preceding  year.     It  is  safe  t©  say  that 


36 

the  amount  in  actual  circulation  among  the  people  to-day  is 
more  than  $100,000,000  less  than  it  was  three  years  ago, 
while  the  demand  for  circulation  has  increased  with  the  in- 
crease of  population.  The  "vast  army  of  the  unemployed" 
bear  witness  to  the  evil  effects  of  this  contraction.  The  pa- 
ralysis of  business,  produced  by  contraction,  has  been  ag- 
gravated by  the  declared  purpose  of  the  present  administra- 
tion to  demonetize  silver  and  contract  the  world's  money  to 
the  gold  standard.  Well  may  capital  timidly  shrink  from 
trade,  and  investors  be  unwilling  to  take  the  chance  of  pur- 
chasing property  when  a  promise  is  made  to  them  by  a 
powerful  administration  that  silver  shall  be  demonetized, 
property  and  labor  made  cheaper,  and  gold  made  dearer. 
Why  should  not  capitalists  hoard  gold,  and  refuse  to  invest 
in  property,  when  the  administration  proposes  to  enhance 
the  value  of  money,  and  depress  the  price  of  property. 

EOBBERY   IN  THE    NAJVIE   OF   PATEIOTISM.  * 

The  message  contains  an  appeal  to  the  patriotism  of  the 
country  to  do  an  act  which  would  rob  the  taxpayer  and  enrich 
the  bondholder.  The  message  does  not  in  terms  assert  that 
the  bonded  indebtedness  of  the  United  States  is  payable  in 
gold  alone,  but  appeals  to  all  good  citizens  not  to  pay  gold 
obligations  in  silver.  We  call  particular  attention  to  the 
following  remarkable  passage  in  the  message  : 

"The  condition  in  which  our  Treasury  may  be  placed  by 
a  persistence  in  our  present  course  is  a  matter  of  concern  to 
every  patriotic  citizen  who  does  not  desire  his  Government 
to  pa}^  in  silver  such  of  its  obligations  as  should  be  paid  in 
gold;  nor  should  our  condition  be  suclj  as  to  oblige  us,  in  a 
prudent  management  of  our  affairs,  to  discontinue  the  call- 
ing in  and  payment  of  interest-bearing  obligations  which 
we  have  the  right  now  to  discharge,  and  thus  avoid  the  pa}'^- 
ment  of  further  interest  thereon." 

Whom  is  the  President  accusing  of  bad  faith  ?  Did  any 
advocate  of  silver  ever  propose  to  violate  the  obligation  of 


37 

contracts  ?  or  pay  gold  obligations  in  silver  ?  What  does 
the  President  mean  by  "  such  of  its  obligations  as  should  be 
paid  in  gold?"  If  he  means  the  bonded  indebtedness  of 
the  United  States,  why  does  he  not  so  declare  ?  If  he  can 
show  that  the  people  of  the  United  States  are  under  any 
legal  or  equitable  obligation  to  pa}^  that  debt  in  gold,  all 
patriotic  citizens  will  join  him  in  requiring  its  payment  in 
that  metal,  at  any  cost.  But  the  President  knows  very  well 
that  every  dollar  of  the  interest-bearing  debt  of  the  United 
States  may  lawfully  be  paid  in  either  g'ld  or  silver. 

The  Act  authorizing  payment  in  either  gold  or  silver  is 
printed  on  every  bond.  When  the  bondholders  first  put 
forward  their  jireposterous  claim  for  jDayment  in  gold  alone, 
the  Congress  of  the  United  States  immediately  took  the 
matter  under  consideration  and  passed  a  concurrent  reso- 
lution, after  exhaustive  debate,  which  we  commend  to 
the  consideration  of  the  President.  The  resolution  to  which 
we  refer  passed  the  Senate  on  the  25th  day  of  January,  1878, 
by  a  vote  of  42  ayes  to  20  noes,  and  was  concurred  in  by  the 
House  on  the  28th  day  of  the  same  month  by  a  vote  of  189 
ayes  to  79  noes.     It  is  as  follows: 

Whekeas,  By  the  Act  entitled  "An  Act  to  strengthen  the 
public  credit,"  approved  March  18,  1869,  it  was  provided 
and  declared  that  the  faith  of  the  United  States  was  thereby 
solemnly  pledged  to  the  payment,  in  coin  or  its  equivalent, 
of  all  the  interest-bearing  obligations  of  the  United  States, 
except  in  cases  where  the  law  authorizing  the  issue  of  such 
obligations  had  exj)ressly  provided  that  the  same  might 
be  paid  in  lawful  money  or  other  currency  than  gold  and 
silver:  and 

Whereas,  All  the  bonds  of  the  United  States  autho- 
rized to  be  issued  b}^  the  Act  entitled  "An  Act  to  authorize 
the  refunding  of  the  national  debt,"  approved  July  14,  1870, 
by  the  terms  of  said  Act  were  declared  to  be  redeemable  in 
coin  of  the  then  present  standard  value,  bearing  interest 
payable  semi-annually  in  such  coin;  and 

Wheeeas,  All  bonds  of  the  United  States  authorized  to  be 
issued  under  the  Act  entitled  "An  Act  to  provide  for  the 


38 

resumption  of  specie  payments,"  approved  January  14, 1875, 
are  required  to  be  of  the  description  of  bonds  of  the  United 
States  described  in  the  said  Act  of  Congress,  approved  July 
14,  1870,  entitled  "An  Act  to  authorize  the  refunding  of  the 
national  debt;"  and 

WHEREA.S,  At  the  date  of  the  passage  of  said  Act  of  Con- 
gress last  aforesaid,  to  Avit:  the  14th  day  of  July,  1870,  the 
coin  of  the  United  States  of  standard  value  of  that  date  in- 
cluded silver  dollars  of  the  weight  of  412^  grains  each,  de- 
clared by  the  Act  approved  January  18,  1837,  entitled  "An 
Act  supplementary  to  the  Act  entitled  'An  Act  establishing 
a  mint  and  regulating  the  coins  of  the  United  States,'  "  to 
be  a  legal  tender  of  payment,  according  to  their  nominal 
value,  for  any  sums  whatever;  therefore. 

Resolved  hy  the  Senate  {the  Hoitse  of  Representatives  concur- 
ring therein)  That  all  the  bonds  of  the  United  States,  issued, 
or  authorized  to  be  issued,  under  said  Acts  of  Congress, 
hereinbefore  recited  are  payable,  principal  and  interest,  at 
the  option  of  the  Government  of  the  United  States,  in  silver 
dollars,  of  the  coinage  of  the  United  States,  containing  412| 
grains  each  of  standard  silver;  and  that,  to  restore  to  its 
coinage  such  silver  coins  as  a  legal  tender  in  payment  of 
said  bonds,  principal  and  interest,  is  not  in  violation  of  the 
public  faith,  nor  in  derogation  of  the  rights  of  the  public 
creditor. 

We  ask:  What  patriotic  citizen  would  again  change  the  con- 
tract between  the  bondholder  and  the  people  and  convert  an 
obligation  payable  in  silver  or  gold  into  a  contract  for  the 
payment  of  gold  alone  ?  Does  the  President  advocate  such 
change?  If  the  change  must  be  made,  let  it  be  made 
directly  and  not  indirectly.  If  there  is  no  respect  for  the 
obligation  of  contracts,  pass  a  law  for  the  payment  of  the 
bonds  in  gold  or  platinum,  or  anything  else  that  the  bond- 
holder may  demand,  but  do  not  do  it  by  demonetizing  silver 
and  depriving  the  people  of  a  sufficient  circulating  medium. 
The  declaration  of  the  President  that  he  would  advocate  the 
conversion  of  contracts  payable  in  silver  into  contracts  pay- 
able in  gold  has  already  prostrated  the  industries  of  the 
country.     What  does  the  President  mean  by  saving  that  the 


39 


condition  of  the  Treasury  may  be  such  if  the  coinage  of 
silver  is  not  stopped  as  to  oblige  us  to  discontinue  to  call  in 
and  pay  interest-bearing  bonds '?  There  is  a  large  amount 
of  overdue  bonds  outstanding.  Does  he  mean  that  there  is 
no  money  in  the  Treasury  with  which  to  pay  them,  when  he 
at  the  same  time  reports  an  enormous  surplus  of  idle  money 
incumbering  the  vaults  of  the  Government?  Does  he  really 
mean  that  the  Treasury  officials  with  his  approval  will  con- 
tinue to  refuse  to  call  in  and  pay  bonds  in  silver  according 
to  the  letter  and  spirit  of  the  law  of  July  14,  1870,  under 
which  they  were  issued?  Is  the  Chief  Executive  faithfully 
executing  the  law  when  he  hoards  silver  with  whicli  the 
bonded  debt  is  payable,  and  allows  interest  to  accumulate 
on  overdue  bonds?  Or  is  he  subserving  some  interest  an- 
tagonistic to  the  people  ? 

THERE  ARE   WIDOWS   AND   ORPHANS   WHO   HATE   NO   BONDS. 

The  allusion  of  the  President  to  the  debtor  class  is  unfor- 
tunate. The  intimation  that  a  debtor  is  dishonest  who 
claims  the  right  to  pay  according  to  the  terms  of  his  con- 
tract is  unjust.  The  President,  however,  seems  to  realize 
that  the  sympathies  of  mankind  may  be  on  the  side  of  the 
toiling  ma?;ses,  whose  burdens  must  necessarily  be  increased 
by  the  enormous  contraction  which  he  proposes  in  the  de- 
monetization of  silver.  To  avoid  the  effect  of  such  sympa- 
thy, and  to  keep  from  view  the  real  beneficiaries  in  the 
scheme  to  contract  the  world' s  money  by  the  demonetization 
of  silver,  he  puts  forward  in  the  place  of  the  Eothschilds 
and  the  Vanderbilts,  poor  widows,  orphans  and  helpless 
beneficiaries.  He  says  (if  the  coinage  of  silver  were  con- 
tinued) : — 

"The  pittance  of  the  widow  and  orphan  and  the  incomes 
of  helpless  beneficiaries  of  all  kinds  would  be  disastrously 
reduced." 

The  President  seems  to  forget  that  there  are  poor  widows 
and  orphans  who  have  no  bonds.     He  also  ignores  the  fact 


40 


that  the  bonds  of  the  United  States  are  to-day  worth  three 
times  as  much  as  when  thej  were  originally  issiied  ;  that  it 
now  requires  three  times  the  amount  of  labor  to  buy  a  dollar 
in  either  gold  or  sih-er  that  it  did  in  1863  to  buy  a  dollar  in 
United  States  bonds. 

It  is  an  insult  to  the  intelligence  of  the  people  to  argue 
that  the  poor  and  not  the  rich  are  the  owners  of  bonds. 
The  President  ought  to  reflect  that  if  the  burdens  of  the 
laborer  are  increased  by  the  manipulations  of  bondholders 
and  national  bank  managers  the  food  and  clothing  of  poor 
widows  and  helpless  orphans  who  have  no  bonds  will  be 
' '  disastrously  reduced. ' ' 

THE     "VAST    ARMY    OF     THE     UNEMPLOYED"     AEE     EARNING    NO 
MONEY   TO   DEPOSIT  IN   SAVINGS   BANKS. 

The  President  appeals  to  depositors  in  savings  banks,  and 
tells  them  that  if  they  are  not  paid  in  gold,  when  they  de- 
posit paper  or  silver,  they  will  be  wronged.  The  depos- 
itors in  savings  banks  are  laborers.  They  earned  their 
money  when  there  was  an  abundant  circulating  medium  and 
when  the  circulation  consisted  of  gold,  silver  and  paper. 
Then  the  Jjrmy  of  the  unemployed  was  not  vast,  and 
did  not  include  millions  who  were  willing  to  work.  The 
depositors  in  savings  banks  are  honest,  and  they  are  satis- 
fied to  be  paid  in  the  same  kind  of  money  which  they  de- 
posited. They  are  laborers,  and  the  contraction  which  the 
demonetization  of  silver  would  produce  would  throw  them 
out  of  employment,  and  force  them  to  consume  their  present 
accumulations  before  good  times  can  come  again.  No  labor- 
ing man  desires  to  increase  the  bondholder's  power,  or  sub- 
ject himself  or  his  posterity  to  slavery  to  enrich  a  favored 
few.  The  President  ought  to  know  that  if  silver  is  demone- 
tized, and  the  gold  standard  adopted,  there  will  be  no  end 
to  contraction,  no  end  to  depression  of  business  no  end  to 
low  wages  and  starvation  and  suttering  among  the  masses. 


41 


CON'SPIFACY   TO   [MAINTAIN   BONDED   ARISTOCRACY   AND   SUBSIDIZED 

BANKS. 

Is  it  possible  that  tlie  President  of  the  United  States  is 
really  scheming  to  demonetize  silver  for  the  purpose  of  in- 
creasing the  power  of  the  national  banks  ?  Does  he  really 
intend  that  the  national  bank  circulation  shall  take  the 
place  of  silyer,  and  that  millions  shall  be  added  to  the  an- 
nual subsidy  which  those  powerful  corporations  now  receive? 
Why  does  not  the  present  administration  call  in  the  bonds 
that  are  due,  and  relieve  the  Treasury  of  its  surplus  revenue? 
Why  invent  schemes  for  increasing  the  expenditures  of  the 
government,  or  for  reducing  its  revenues,  while  unpaid, 
over-due  bonds  remain  subject  to  call?  Why  has  the 
present  administration  refused  to  ap]^ly  the  surplus  in 
the  Treasury  to  the  payment  of  the  public  debt?  Is  it 
possible  that  there  is  a  conspiracy  on  foot  in  the  interest  of 
the  national  banks  and  the  bondholders  to  keep  the  exist- 
ing national  debt  afloat,  and  increase  it,  if  possible,  so  that 
a  bonded  aristocracy  can  be  maintained  in  the  United  States, 
and  the  national  banks  furnished  with  an  ample  supply  of 
United  States  bonds  to  enable  them  to  increase  the  enor- 
mous subsidy  which  they  now  enjoy,  and  maintain  permanent 
control  of  the  political  as  w-ell  as  the  financial  power  of  the 
government?  It  is  manifest  from  the  President's  message 
that  all  patriotic  citizens  ought  to  unite  in  resisting  the  com- 
bined power  of  the  bondholders  and  national  banks,  which 
have  for  years  controlled  all  national  administrations,  and 
threaten  to  subvert  the  liberties  of  the  people. 

The  President's  message  has  spread  gloom  and  apprehen- 
sion over  the  Pacific  Coast.  The  refusal  of  the  Treasury 
ofl&cials  to  execute  the  law  of  1878  in  good  faith  was  famil- 
iar to  the  mining  States  and  Territories.  They  were  annoyed 
by  the  vexatious  and  arbitrary  rules  of  the  Treasury  Depart- 
ment, which  deprived  them  of  silver  as  a  circulating  medium. 
They  could  see  no  reason  why  silver  coin  needed  here  could 
not    be  exchanged  for  gold  by   the  Sub-Treasury  without 


42 

applying  to  Wasliington  in  each  case  for  autlioiity  to  make 
the  exchange;  nor  could  they  see  why  silver  coin  needed 
here  should  be  shipped  to  New  York  or  Washington  at 
great  expense,  and  withheld  from  circulation  among  the 
people.  But  they  did  not  imagine  for  a  moment  that  the 
President  of  the  United  States  was  a  party  to  such  disreput- 
able transactions.  They  do  not  now  believe  that  he  is  guilty 
of  any  intentional  wrong,  but  the}'  fear  what  is  equally 
disastrous  to  the  best  interests  of  the  country,  that  he  is 
misled,  deceived  and  imposed  iipon  by  the  unscrupulous 
and  artful  misrepresentations  of  the  bondholders  and 
national  banks. 

ilANY     WHEAT     GROWERS     AND     COTTOX      PLANTERS     ESPECIALLY 

INJURED. 

We  call  the  attention  of  the  President  to  tlie  fact,  that,  in 
addition  to  the  general  depression  of  business  and  the  great 
injustice  to  the  people  which  would  be  effected  by  the  de- 
monetization of  silver,  there  are  three  great  industrial 
classes  of  the  United  States  who  would  be  especially 
injured  thereby,  to  wit:  gold  and  silver  miners,  cultivators 
of  wheat  and  planters  of  cotton.  The  great  wheat  and 
cotton  producing  empire  of  India,  with  its  250,000,000  of 
population,  has  silver  for-  its  circulating  medium.  All  pro- 
ducts of  India  are  bought  on  the  silver  basis.  W^heat  and 
cotton  are  purchased  in  India  with  silver  and  sold  in  Eu- 
rope for  gold.  The  difference  between  silver  and  gold  in 
London  is  about  25  per  cent.  This  difference  gives  the 
wheat  or  cotton  merchant  of  India  25  per  cent,  advantage 
in  the  European  markets  over  the  merchant  of  the  United 
States  dealing  in  those  commodities.  The  rapid  accumu- 
lation of  the  wealth  of  the  merchants  of  San  Francisco  who, 
during  the  civil  war,  bought  goods  in  the  East  with  green- 
backs worth  50  cents  on  the  dollar  in  coin,  and  sold  the 
same  goods  on  the  Pacific  Coast  for  gold,  illustrates  the 
advantafje  which  the  merchant  of  India  has  when  he  buys 


•43 


wheat  or  cotton  at  home  for  silver,  and  sells  it  in  Europe 
for  gold. 

The  cotton  planters  of  the  South  and  the  wheat-growers 
of  the  Northwest  and  of  the  Pacific  Coast  have  suffered  in 
their  European  market  for  several  years  by  a  ruinous  com- 
petition with  India,  resulting  from  cheap  silver  anil  dear 
gold.  If  the  law  of  1878  is  repealed  and  the  price  of  silver 
still  further  reduced,  the  advantages  of  the  importer  of 
wheat  and  cotton  from  India  over  the  importer  of  the  same 
articles  from  the  United  States  in  every  European  market 
will  be  greatly  increased. 

No  one  will  deny  that  the  demonetization  of  silver  would 
stop  silver  mining,  but  the  fact  that  it  will  also  stop  one  of 
the  principal  supplies  of  gold  is  not  generally  understood. 
Most  of  the  great  silver  mines  of  the  world  contain  a  large 
percentage  of  gold.  The  average  amount  of  gokbin  the  ores 
of  the  Comstock  exceeds  forty  per  cent,  of  their  value.  If 
silver  mining  is  stopped  it  will  not  pay  to  work  the  so-called 
silver  mines  for  gold  alone.  The  silver  mines  will  be  closed 
down,  and  a  source  of  supply  ^vhich  furnishes  a  large  per- 
centage— perhaps  one-half — of  the  annual  product  of  gold 
in  the  world  will  be  cut  ofH. 

Every  industry  in  the  United  States  will  be  injured  by  the 
demonetization  of  silver.  The  only  possible  good  that  has 
been  or  can  be  suggested  from  this  attack  upon  silver  is  to 
enhance  the  value  of  bonds,  and  furnish  an  excuse  for  further 
subsidies  to  national  banks.  The  government  of  the  United 
States  does  not  exist  for  these  two  favored  classes  alone, 
and  the  time  will  come  when  the  people  will  rise  against 
the  now  apparently  overwhelming  power  of  the  combination 
of  European  syndicates  and  American  bankers. 

W.  M.  S. 


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